News Story

May 27, 2015

Environment@Harvard

Resolving the Trade Versus Environment Conflict

Since his earliest days as a Harvard undergraduate, Mark Wu has been tackling complex issues on a global scale. In 1991, in his first year on campus, he co-founded the student-run Harvard Project for Asia and International Relations (HPAIR) to convene students from Harvard and top Asia-Pacific universities. “The conferences were eye-opening for me,” recalls Wu, now an assistant professor at Harvard Law School. “The students from Asia—who were trying to define their roles as future leaders of interconnected national economies—were wrestling with the implications of their countries’ emerging economic power and the challenge of balancing environmental sustainability and economic development.”

Though well-known for his work in international trade law—he co-authored The Law of the World Trade Organization and has served as Director for Intellectual Property in the Office of the U.S. Trade Representative (USTR)—Wu’s first career steps were motivated by interest in sustainable development, particularly in East Asia. “My earliest professional projects were with the World Bank’s rural water sanitation and urban environmental pollution teams,” he recalls. “My friends joked that I had done all this schooling to become a glorified toilet inspector.” Wu later broadened his focus to international trade after the Asian financial crisis, when he began studying opportunities for, and barriers to, sustainable economic growth.

As a Harvard Law School faculty member and HUCE faculty associate, Wu has brought his skills and expertise to take on a rising challenge playing out in national administrative agencies, in World Trade Organization (WTO) proceedings and negotiations, and other forums: a trade versus environment conflict that could have a long-term impact on global efforts to limit climate change and spur environmentally friendly industries. This conflict has emerged because, as Wu notes, “Nations are increasingly employing green industrial policies intended to aid development of environmentally friendly industries—with the goal of making their economies both more robust and more environmentally sustainable. But these policies sometimes provide a subsidy or other unique benefit to the domestic industries. Therefore, while they produce significant economic and environmental benefits, they have negative trade effects and often violate WTO rules.”

How to resolve the conflict and balance the competing goals? “Finding resolution will require fundamentally rethinking about how these cases are adjudicated and what types of penalties are imposed,” Wu explains. “We need to craft rules that allow countries to nurture their own green economies without unfairly tipping the scales against their trading partners … and engaging in beggar-thy-neighbor protectionism.”

Wu’s influential 2014 article in the Northwestern University Law Review (co-authored with James Salzman, a professor of law and of environmental policy at Duke Law School and a HLS visiting professor) helped prompt just such a rethinking and re-crafting process. High-level discussions have taken place at the United Nations Conference on Trade and Development, for example, and the WTO launched negotiations in 2014 for an Environmental Goods Agreement, with forty-four nations participating. Wu recently completed another article examining why more developing countries are not involved and how to draw them into the mix. Looking forward hopefully, he says, “If nations decide to work cooperatively rather than try to win markets at others’ expense, international trade rules can help facilitate resolution of global environmental challenges."